One major reason why the purchasing power parity theory does not always predict exchange rates accurately is that the theory focuses on trade in
A. monies.
B. goods and services.
C. stocks and bonds.
D. physical assets.
Answer: B
You might also like to view...
The figure above shows the supply curve for soda. The market price is $1.00 per soda. The producer surplus from the 10,000th soda is
A) $0.00. B) $0.50. C) $1.00. D) more than $1.00. E) None of the above answers is correct.
Which of the following is an accurate statement regarding the evolution of the Federal Reserve System?
A) The independence of the Federal Reserve has been systematically eroded by legislation. B) The Federal Reserve has shifted from an agency controlled by the states to a federally controlled agency. C) The Federal Reserve has shifted from a fiscal policy agency to a monetary policy agency. D) The Federal Reserve has shifted from a regional service agency to a national policy-making institution.
The income effect is the concept that changes in consumption of a good result from changes in government spending
a. True b. False Indicate whether the statement is true or false
Before the flu season begins, Jeremy gets a flu shot. As a result, Jeremy and several of his friends and relatives avoid the flu for the entire flu season. It would make sense to argue that
a. flu shots provide a positive externality, and that flu shots should be subsidized. b. if flu shots are not subsidized, then the number of people getting flu shots will be smaller than the socially optimal number. c. the externality generated by flu shots is more like the externality generated by education than the externality generated by pollution. d. All of the above are correct.